Consumer Sentiment Dips in Late August: Survey

U.S. consumer sentiment pulled back in late August from earlier in the month but still improved from late July in the face of dismal labor and housing conditions, a private survey released on Friday showed.

The modest pickup in consumer mood came after a drop in July to the lowest level since November, according to Thomson Reuters/University of Michigan's Surveys of Consumers.

The survey's final August reading on the overall index of consumer sentiments was 68.9, below the 69.6 earlier this month but above the 67.8 at the end of July.

Analysts had expected a final August figure of 69.6.

"The good news is that consumers have shown some resilience in the face of slowing economic growth and the media's double-dip drumbeat," Richard Curtin, director of the surveys, said in a statement.

"The bad news is that consumers expect lackluster income and job growth for an extended period of time," he added.

While an outright decline in consumer spending -- which drives nearly 70 percent of the U.S. economy -- is unlikely, the chances for a double-dip recession is now "uncomfortably high" at 25 percent, Curtin said.

Consumer spending has been buoyed by discounts at stores and malls and by car dealers' cheaper financings, Curtin said.

The survey's barometer of current economic conditions held steady from its earlier August reading at 78.3, up from 76.5 in July. Analysts had predicted a figure of 78.0.

The consumer expectations index ended at 62.9 for the month, down from earlier 64.1 but up from 62.3 in July. Analysts had forecast a reading of 63.5.

The measure of consumers' 12-month economic outlook stood at 69, unchanged from early August and up from 66 in July.

The survey's one-year inflation expectations measure dipped back to the end-July level of 2.7 percent after ticking up to 2.8 percent in early August.

U.S. consumer sentiment pulled back in late August from earlier in the month but still improved from late July in the face of dismal labor and housing conditions, a private survey released on Friday showed.
The modest pickup in consumer mood came after a drop in July to...